Mortgage Law

When purchasing a home, it is often necessary to work with a mortgage company or bank to secure a loan for the property. There are several different types of mortgage payback plans, with varying interest rates and monthly rates. Choosing the right type of mortgage can help you protect your property and avoid foreclosure of your home.

Various federal and state laws provide mortgage protection for homeowners. For example, fair business practice laws prohibit all types of mortgage and loan fraud. Laws such as the Fair Housing Act prohibit mortgage creditors from discrimination against homeowners on the basis of race, age, sex, and other protected categories. Read more.

Finding the Right Mortgage Lawyer

Another major piece of legislation that governs mortgages is the Homeownership Equity Protection Act (HOEPA). This federal statute lists a number of unfair mortgage practices that creditors are prohibited from engaging in, including:

Approving loans without considering the borrower's ability to repay

Charging final payments which are more than double the normal monthly payments

Reducing the monthly payments every month (this has the effects of increasing principal debt as well as making it longer to pay off the loan)

Foreclosure is also a major concern when it comes to mortgage protections. Failing to make payments or being late on monthly mortgage payments can lead to foreclosure, wherein the house is repossessed by the bank and sold in order to obtain the late payments. Fortunately, there are a variety of legal mechanisms available that may help you to obtain mortgage protection and protection against foreclosure. These include:

Equity of Redemption: This allows the homeowner to pay off the balance of the debt prior to foreclosure, thus avoiding the foreclosure sale of the home

Right to Bid: Sometimes the mortgage company will allow the borrower to place a bid during the auction where the house is being sold. This basically allows the home owner to repurchase the property from the mortgage lender

Finally, the term "mortgage protection" can also refer to mortgage protection insurance. Purchasing mortgage protection insurance basically guarantees that the insurer will pay for mortgage payments in the event that the insured becomes incapacitated or unemployed. These may involve an insurance contract which should be reviewed by an attorney.

You may wish to hire a real estate lawyer if you have any issues regarding your mortgage, whether it be fraud, discrimination, unfair contracts, or foreclosure. An experienced attorney can explain the different mortgage protections available to you.